AVCHD capture uses better compression for smaller files that then need to be rendered outside of camera, whereas M-JPEG is a series of JPEG images replayed as a movie (AVI format) that can be used straight from camera.

Exposure

The E-P3's movie capabilities have some great quirks: Full manual control means aperture, shutter and ISO options can be adjusted for absolute control. However none of these settings can be changed during capture, a significant oversight that could have stepped up the camera's capabilities considerably.

Pressing the one-touch movie button will start recording rolling, but accurate composition is flawed here as the E-P3 uses a different portion of the sensor for movie capture. This causes cropping, i.e. the original frame you thought was going to be captured will suddenly be more 'zoomed in' and lose the surrounding edge (this even occurs if set to 16:9 ratio in stills mode). Small details like this hold the E-P3 back from having a more pro-fulfilling movie mode.

Auto focus

During recording there's the option of continuous autofocus, single autofocus (both of which can have the addition of manual override) or manual focus.

The E-P3's continuous autofocus mode is the one that particularly impresses, as it eases subjects into focus with little problems. It's a frustration that the focus point can't be moved around during capture, which becomes yet more of a misgiving when considering the E-P3's touch-sensitive screen (that's rendered useless in movie mode). It should have taken a leaf out of the Panasonic G3's book and allowed for full touchscreen focus control during capture.

Performance

The E-P3's 20Mbps data rate should produce high quality, though compression seems a bit over the top at times - looking in detail areas reveals processed, 'fuzzy' edges. A lower 'Normal' compression option is also available as a further space-saving option.

Sound is captured via the on-board stereo microphone, though wind noise can be an issue. While it's possible to employ an external microphone the Olympus-only Accessory Port means there's only one current microphone (SEMA-1) available. A standard 3.5mm fitting for third party microphones would have made more sense and opened the camera up to an even wider audience.

Overall the E-P3 improves capture options from previous models but fails to iron out small details that would have taken this good camera to levels of greatness.